I just read a post on I-Sales about bidding wars on search engine keywords, and it occured to me that Overture's model is great because there are only so many words in the English language (or any language for that matter), whereas advertising models based on banner inventory have the laws of supply and demand working against them.

With an increasing number of online users spending more hours online on more numerous and bigger web sites, page views and ad impressions derived from them are fighting an uphill battle just to find a buyer, as the quantity of auto-promotion and banner barter proved even before the advertising market bust.

What is it that you can create on your online properties that doesn't exist elsewhere in almost infinite quantities (we mortal humans have trouble telling the difference between "infinite" and "huge" anyway)? I'm not sure maintream portals à la Yahoo can really differentiate themselves to visitors. Sure, they can get Pepsi as an advertiser, but what does it mean to you as a user? So far it's only been meaning more intrusion and privacy snafus, and generically speaking looking more and more like TV, a medium that 100% of households happen to already get, well, on TV.

Now if online targetting means anything as a way to attract advertisers, that's where the Internet comes with unique strengths. Here I'm not so much mentioning the usual demographics/psychographics targetting, as much as the ability to address very specific needs in a detailed way. And what enables niche sites to reach their potential users? Exactly, search engines. How's that for a circular post? It works well except I just forgot to make a point here!

OK, so my point is, ultra-targeted online properties make sense to users (either for free or for a fee, as I've been arguing lately on TheEndOfFree), they make sense for publishers (if only to nail down an effective USP), and they should make sense for advertisers as well if it becomes easier for them to purchase and manage "niche online campaigns." Online business success is probably a matter of creating products (content and services for users, ad space for advertisers), that exist in finite quantities to protect the value of both content and ad inventory.

It's of course mainly the work of site owners to identify and service niches the best they can. Thinking beyond plain static content, into databases and/or community is probably a good direction to look into (when database and community meet, that's eBay and see how powerful a combination it can become.)

But we as customers or ad campaign managers need to grow beyond a spoilt kid attitude. The great feeling of infinity we get on the Internet is liberating as a whole, and I only wish more people enjoy it and contribute to it in the future. However, this perception has debilitating effects to niche sites which struggle to get acknowledged by users and advertisers for the unique value they provide. And it's counter-productive and sad to realize and miss the value only until after it's lost (my mother keeps telling me this too!)

Next time you discover a great site that appeals to your interests, think about sticking to it in the future. Participate in its growth, if only by promoting it to your friends. Assuming that Google will always pick up good stuff for you is dangerous, because Google doesn't create anything but a collection of links. Always on the move nomads don't create cities, yet it takes more than temporary tents to host and grow great sites. The Internet as a whole might feel infinite, but don't take for granted there are and always will be an infinite number of alternatives to the sites you love. To conclude on a less-than stellar image (warning: incoming bad pun), the universe might be infinite and growing, but you don't find planets around every star.

Update: We're Broke: The Economics of a Web Community (by rusty of Kuro5hin)

06/24/02 update: It Takes a Village to Save a Site.